Explain fixed, variable and semi-variable costs.

Explain fixed, variable and semi-variable costs.


Fixed Cost is the cost which remains constant or unaffected by variations in the volume of output within a given period of time. Example: Rent or rates, Insurance charges, etc.

Variable Cost is the cost which varies directly in proportion with every increase or decrease in the volume of output with a given a period of time. Example: Wages paid to labours, cost of direct material, consumable stores, etc.

Semi-variable Cost is the cost which is neither fixed nor variable in nature. These remain fixed at certain level of operations while may vary proportionately at other levels of operations. Example: maintenance cost, repairs, power, etc.
Explain controllable and uncontrollable costs.
Controllable Cost are the costs which can be influenced by the action...Uncontrollable Cost are the costs which cannot be influenced by the action..
Explain Normal and Abnormal Costs.
Normal Cost are the normal or regular costs which are incurred in the normal conditions…
Explain Opportunity Cost and Differential Cost.
Opportunity Cost is the cost incurred by the organisation when one alternative is selected over another..
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maintainence costs
Why maintainence costs are semi variable in nature?
Can anyone answer this?
peru 04-1-2015